SB218: Bill Text

SB218, s. 53 Section 53. 635.11 (2m) of the statutes is created to read:

SB218,47,7 635.11 (2m) Information required to be disclosed under this section shall be provided in a manner that is understandable to an employer and shall be sufficient to reasonably inform an employer of the employer's rights and obligations under the health insurance coverage.

SB218, s. 54 Section 54. 635.11 (3m) of the statutes is created to read:

SB218,47,10 635.11 (3m) An insurer is not required under this section to disclose information that is proprietary or trade secret information under applicable law.

SB218, s. 55 Section 55. 635.13 (title) of the statutes is amended to read:

SB218,47,13 635.13 (title) Annual certification of compliance for group health benefit plans.

SB218, s. 56 Section 56. 635.13 (1) of the statutes is amended to read:

SB218,47,20 635.13 (1) Records. A small employer An insurer that issues group health benefit plans shall maintain at its principal place of business complete and detailed records with respect to those group health benefit plans relating to its rating methods and practices and its renewal underwriting methods and practices, and shall make the records available to the commissioner and the small employer insurance board upon request.

SB218,47,25 (2) Certification. A small employer An insurer that issues group health benefit plans shall file with the commissioner on or before May 1 annually an actuarial opinion by a member of the American academy of actuaries Academy of Actuaries certifying all of the following with respect to those group health benefit plans:

SB218,48,2 (a) That the small employer insurer is in compliance with the rate provisions of s. 635.05 635.09.

SB218,48,4 (b) That the small employer insurer's rating methods are based on generally accepted and sound actuarial principles, policies and procedures.

SB218,48,8 (c) That the opinion is based on the actuary's examination of the small employer insurer's records and a review of the small employer insurer's actuarial assumptions and statistical methods used in setting rates and procedures used in implementing rating plans.

SB218, s. 57 Section 57. 635.15 of the statutes is renumbered 635.10 and amended to read:

SB218,48,17 635.10 (title) Temporary suspension of rate regulation for individual and group health benefit plans. The commissioner may suspend the operation of all or any part of s. 635.05 635.09 with respect to one or more small employers or one or more individuals for one or more rating periods upon the written request of a small employer an insurer and a finding by the commissioner that the suspension is necessary in light of the financial condition of the small employer insurer or that the suspension would enhance the efficiency and fairness of the small employer health insurance market.

SB218, s. 58 Section 58. 635.16 of the statutes is created to read:

SB218,48,23 635.16 Contract termination and renewability for group health benefit plans. (1) (a) Except as provided in subs. (2) to (4) and notwithstanding s. 631.36 (2) to (4m), an insurer that offers a group health benefit plan shall renew such coverage or continue such coverage in force at the option of the employer and, if applicable, plan sponsor.

SB218,48,25 (b) At the time of coverage renewal, the insurer may modify a group health benefit plan issued in the large group market.

SB218,49,2 (2) Notwithstanding s. 631.36 (2) to (4m), an insurer may nonrenew or discontinue a group health benefit plan, but only if any of the following applies:

SB218,49,4 (a) The plan sponsor has failed to pay premiums or contributions in accordance with the terms of the group health benefit plan or in a timely manner.

SB218,49,7 (b) The plan sponsor has performed an act or engaged in a practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of the coverage.

SB218,49,10 (c) The plan sponsor has failed to comply with a material plan provision that is permitted under law relating to employer contribution or group participation rules.

SB218,49,13 (d) The insurer is ceasing to offer coverage in the market in which the group health benefit plan is included in accordance with sub. (3) and any other applicable state law.

SB218,49,17 (e) In the case of a group health benefit plan that the insurer offers through a network plan, there is no longer an enrollee under the plan who resides, lives or works in the service area of the insurer or in an area in which the insurer is authorized to do business.

SB218,49,22 (f) In the case of a group health benefit plan that is made available only through one or more bona fide associations, the employer ceases to be a member of the association on which the coverage is based. Coverage may be terminated if this paragraph applies only if the coverage is terminated uniformly without regard to any health status-related factor of any covered individual.

SB218,50,2 (3) (a) Notwithstanding s. 631.36 (2) to (4m), an insurer may discontinue offering in this state a particular type of group health benefit plan offered in either the large group market or the group market other than the large group market, but only if all of the following apply:

SB218,50,6 1. The insurer provides notice of the discontinuance to each employer and, if applicable, plan sponsor for whom the insurer provides coverage of this type in this state, and to the participants and beneficiaries covered under the coverage, at least 90 days before the date on which the coverage will be discontinued.

SB218,50,13 2. The insurer offers to each employer and, if applicable, plan sponsor for whom the insurer provides coverage of this type in this state the option to purchase from among all of the other group health benefit plans that the insurer offers in the market in which is included the type of group health benefit plan that is being discontinued, except that in the case of the large group market, the insurer must offer each employer and, if applicable, plan sponsor the option to purchase one other group health benefit plan that the insurer offers in the large group market.

SB218,50,18 3. In exercising the option to discontinue coverage of this particular type and in offering the option to purchase coverage under subd. 2., the insurer acts uniformly without regard to any health status-related factor of any covered participants or beneficiaries or any participants or beneficiaries who may become eligible for coverage.

SB218,50,22 (b) Notwithstanding s. 631.36 (2) to (4m), an insurer may discontinue offering in this state all group health benefit plans in the large group market or in the group market other than the large group market, or in both such group markets, but only if all of the following apply:

SB218,51,2 1. The insurer provides notice of the discontinuance to the commissioner and to each employer and, if applicable, plan sponsor for whom the insurer provides coverage of this type in this state, and to the participants and beneficiaries covered under the coverage, at least 180 days before the date on which the coverage will be discontinued.

SB218,51,5 2. All group health benefit plans issued or delivered for issuance in this state in the affected market or markets are discontinued and coverage under such group health benefit plans is not renewed.

SB218,51,8 3. The insurer does not issue or deliver for issuance in this state any group health benefit plan in the affected market or markets before 5 years after the day on which the last group health benefit plan is discontinued under subd. 2.

SB218,51,10 (4) This section does not apply to a group health benefit plan offered by the state under s. 40.51 (6) or by the group insurance board under s. 40.51 (7).

SB218, s. 59 Section 59. 635.165 of the statutes is created to read:

SB218,51,17 635.165 Guaranteed renewability of individual health benefit plans. (1) (a) Except as provided in subs. (2) and (3) and notwithstanding s. 631.36 (2) to (4m), an insurer that provides individual health benefit plan coverage shall renew such coverage or continue such coverage in force at the option of the insured individual and, if applicable, the association through which the individual has coverage.

SB218,51,21 (b) At the time of coverage renewal, the insurer may modify the individual health benefit plan coverage policy form as long as the modification is consistent with state law and effective on a uniform basis among all individuals with coverage under that policy form.

SB218,51,24 (2) Notwithstanding s. 631.36 (2) to (4m), an insurer may nonrenew or discontinue the individual health benefit plan coverage of an individual, but only if any of the following applies:

SB218,52,3 (a) The individual or, if applicable, the association through which the individual has coverage has failed to pay premiums or contributions in accordance with the terms of the health insurance coverage or in a timely manner.

SB218,52,7 (b) The individual or, if applicable, the association through which the individual has coverage has performed an act or engaged in a practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of the health insurance coverage.

SB218,52,9 (c) The insurer is ceasing to offer individual health benefit plan coverage in accordance with sub. (3) and any other applicable state law.

SB218,52,14 (d) In the case of individual health benefit plan coverage that the insurer offers through a network plan, the individual no longer resides, lives or works in the service area or in an area in which the insurer is authorized to do business. Coverage may be terminated if this paragraph applies only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals.

SB218,52,19 (e) In the case of individual health benefit plan coverage that the insurer offers only through one or more bona fide associations, the individual ceases to be a member of the association on which the coverage is based. Coverage may be terminated if this paragraph applies only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals.

SB218,52,21 (f) The individual is eligible for medicare and the commissioner by rule permits coverage to be terminated.

SB218,52,24 (3) (a) Notwithstanding s. 631.36 (2) to (4m), an insurer may discontinue offering in this state a particular type of individual health benefit plan coverage, but only if all of the following apply:

SB218,53,4 1. The insurer provides notice of the discontinuance to each individual for whom the insurer provides coverage of this type in this state and, if applicable, to the association through which the individual has coverage at least 90 days before the date on which the coverage will be discontinued.

SB218,53,8 2. The insurer offers to each individual for whom the insurer provides coverage of this type in this state and, if applicable, to the association through which the individual has coverage the option to purchase any other type of individual health insurance coverage that the insurer offers for individuals.

SB218,53,12 3. In electing to discontinue coverage of this particular type and in offering the option to purchase coverage under subd. 2., the insurer acts uniformly without regard to any health status-related factor of enrolled individuals or individuals who may become eligible for the type of coverage described under subd. 2.

SB218,53,15 (b) Notwithstanding s. 631.36 (2) to (4m), an insurer may discontinue offering individual health benefit plan coverage in this state, but only if all of the following apply:

SB218,53,20 1. The insurer provides notice of the discontinuance to the commissioner and to each individual for whom the insurer provides individual health benefit plan coverage in this state and, if applicable, to the association through which the individual has coverage at least 90 days before the date on which the coverage will be discontinued.

SB218,53,22 2. All individual health benefit plan coverage issued or delivered for issuance in this state is discontinued and coverage under such coverage is not renewed.

SB218,53,25 3. The insurer does not issue or deliver for issuance in this state any individual health benefit plan coverage before 5 years after the day on which the last individual health benefit plan coverage is discontinued under subd. 2.

SB218, s. 60 Section 60. 635.18 (title) of the statutes is amended to read:

SB218,54,3 635.18 (title) Fair marketing standards for group and individual health benefit plans.

SB218, s. 61 Section 61. 635.18 (1) of the statutes is renumbered 635.18 (1) (intro.) and amended to read:

SB218,54,15 635.18 (1) (intro.) Every small employer insurer that provides coverage under a health benefit plan shall actively market such health benefit plan coverage, including basic health benefit plans, to small employers in the state. If a small employer insurer denies coverage to a small employer under a health benefit plan that is not a basic health benefit plan on the basis of the health status or claims experience of the small employer or its eligible employes or their dependents, the small employer insurer shall offer the small employer the opportunity to purchase a basic health benefit plan. In addition to other marketing limitations that the commissioner may authorize by rule, an insurer may limit its marketing under this subsection to any of the following:

SB218, s. 62 Section 62. 635.18 (1) (a) and (b) of the statutes are created to read:

SB218,54,17 635.18 (1) (a) Health benefit plans for employer groups of all sizes.

SB218,54,18 (b) Health benefit plans for individuals.

SB218, s. 63 Section 63. 635.18 (2) of the statutes is amended to read:

SB218,54,21 635.18 (2) (a) Except as provided in par. (b), a small employer an insurer or an intermediary may not, directly or indirectly, do any of the following:

SB218,54,25 1. Discourage a small an employer or an individual from applying, or direct a small an employer or an individual not to apply, for coverage with the small employer insurer because of the health status condition, claims experience, industry, occupation or geographic location area of the small employer or individual.

SB218,55,3 2. Encourage or direct a small an employer or an individual to seek coverage from another insurer because of the health status condition, claims experience, industry, occupation or geographic location area of the small employer or individual.

SB218,55,7 (b) Paragraph (a) does not prohibit a small employer an insurer or an intermediary from providing a small an employer or an individual with information about an established geographic service area or a restricted network provision of the small employer insurer.

SB218, s. 64 Section 64. 635.18 (3) (a) of the statutes is amended to read:

SB218,55,14 635.18 (3) (a) Except as provided in par. (b), a small employer an insurer may not, directly or indirectly, enter into any contract, agreement or arrangement with an intermediary that provides for or results in compensation to an the intermediary for the sale of a health benefit plan that varies according to the health status condition, claims experience, industry, occupation or geographic location area of the small employer or, eligible employes, insured individual or dependents.

SB218, s. 65 Section 65. 635.18 (3) (b) of the statutes is amended to read:

SB218,55,19 635.18 (3) (b) Payment of compensation on the basis of percentage of premium is not a violation of par. (a) if the percentage does not vary based on the health status condition, claims experience, industry, occupation or geographic area of the small employer or, eligible employes, insured individual or dependents.

SB218, s. 66 Section 66. 635.18 (3) (c) of the statutes is repealed.

SB218, s. 67 Section 67. 635.18 (4) of the statutes is amended to read:

SB218,56,2 635.18 (4) A small employer An insurer may not terminate, fail to renew or limit its contract or agreement of representation with an intermediary for any reason related to the health status condition, claims experience, occupation or geographic location area of the small employers or, eligible employes , insured individuals or their dependents placed by the intermediary with the small employer insurer.

SB218, s. 68 Section 68. 635.18 (5) of the statutes is amended to read:

SB218,56,7 635.18 (5) A small employer An insurer or an intermediary may not induce or otherwise encourage a small an employer to separate or otherwise exclude an employe from health coverage or benefits provided in connection with the employe's employment.

SB218, s. 69 Section 69. 635.18 (6) of the statutes is amended to read:

SB218,56,11 635.18 (6) Denial by a small employer an insurer of an application for coverage from a small employer under a health benefit plan shall be in writing and shall state the reason or reasons for the denial.

SB218, s. 70 Section 70. 635.18 (7) of the statutes is amended to read:

SB218,56,17 635.18 (7) A 3rd-party administrator that enters into a contract, agreement or other arrangement with a small employer an insurer to provide administrative, marketing or other services related to the offering of health benefit plans to small employers or individuals in this state is subject to this subchapter chapter as if it were a small employer an insurer.

SB218, s. 71 Section 71. 635.18 (8) of the statutes is amended to read:

SB218,56,22 635.18 (8) The commissioner may by rule establish additional standards to provide for the fair marketing and broad availability of health benefit plans to small employers and individuals in this state, including requirements designed to prevent evasion of the purposes of this chapter.

SB218, s. 72 Section 72. Subchapter II of chapter 635 [precedes 635.20] of the statutes, as affected by 1995 Wisconsin Act 289, is repealed.

SB218, s. 73 Section 73 . Nonstatutory provisions.

SB218,57,6 (1) Risk adjustment committee. The commissioner of insurance shall appoint a committee on risk adjustment under section 15.04 (1) (c) of the statutes, consisting of 5 to 8 members, to advise the commissioner on, and to assist the commissioner in developing rules for, the group risk adjustment mechanism under section 635.06 (4) of the statutes, as created by this act. The commissioner shall appoint at least 5 representatives of insurers to be members of the committee.

SB218,57,14 (2) Risk adjustment mechanism emergency rule-making authority. Using the procedure under section 227.24 of the statutes, the commissioner of insurance may promulgate rules under section 635.06 (4) (e) of the statutes, as created by this act, for the period before the effective date of the permanent rules promulgated under section 635.06 (4) (e) of the statutes, as created by this act, but not to exceed the period authorized under section 227.24 (1) (c) and (2) of the statutes. Notwithstanding section 227.24 (1) and (3) of the statutes, the commissioner is not required to make a finding of emergency.

SB218,57,15 (3) Evaluation of market reforms.

SB218,57,20 (a) The commissioner of insurance shall evaluate the effectiveness of the health insurance market reforms under chapter 635 of the statutes, as affected by this act, and under the federal Health Insurance Portability and Accountability Act of 1996, P.L. 104-191, including the effectiveness of the reforms with respect to all of the following:

SB218,57,22 1. Accessibility of health insurance coverage, including such accessibility for persons who reside in rural areas of the state.

SB218,57,23 2. Availability of health insurance coverage for uninsured persons.

SB218,57,24 3. Affordability of health insurance coverage.

SB218,58,4 (b) The commissioner shall submit a report of the results of the evaluation and any recommendations to the legislature in the manner provided under section 13.172 (2) of the statutes no later than the first day of the 24th month beginning after publication.

SB218, s. 74 Section 74 . Initial applicability.